If you feel like the price of everything is always going up while your wages seem to hardly move, then you are not alone. And your instincts are right.
According to the official numbers, wages are rising at just 2.3% on average while costs, as measured by inflation, are creeping along at 2.2%.
But there’s probably one set of expenses you haven’t put much thought into — the cost of going to work. By that we mean more than just a weekly train or bus ticket.
Income doesn’t just generate wealth, it also consumes it, according to a study by the demographers at McCrindle Research.
“Australians are forking out more than ever on transport costs, clothing and food while they are working, significantly reducing their take home pay,” says McCrindle.
“Incurring travel costs associated with work, work-related education expenses, child care costs, and income tax all further reduce a full-time worker’s take-home pay to less than two-thirds of their gross salary.”
McCrindle looked at the average full-time Australian worker who earns $80,049 a year. Here’s their work-related expenses:
That’s $889 on lunches, $320 on wardrobe changes, $4,794 on transport costs, $587 on education, $17,760 on child-care (based on 70 hours at average costs) and $16,768 on tax (not including tax deductions).
These total work costs add up to $41,118, which is 51% of the average annual before tax wage.